Stop making IMF the scapegoat

There is a tendency among Caribbean politicians to lay blame at the feet of the Washington-based International Monetary Fund (IMF) for inflicting harsh austerity measures on the backs of their people.

This is a fallacy that ought to be put into its true perspective.

Historically, the IMF is the only place available to governments that have landed themselves in trouble and have no other choice but to go in the direction of this “lender of last resort”.

It is not the IMF that is responsible for handing out the bitter medicine to be swallowed by countries that have found themselves facing severe fiscal deficits.

The records will show that the IMF has never called any Third World country to come and knock on its door for a rescue package.

It is always the other way around – the countries choose to go to the IMF for bail outs when they have exhausted all other available avenues.

Our leading calypsonian Black Wizard puts it so right when he said that the IMF in its effort to tackle the ills of such countries that come to it will inform them that if they want “my money” then these are the set conditions that would have to be met and followed over a period of time.

And we are  very familiar with typical IMF prescriptions like retrenchment of workers to cut on expenditure spending, divesting loss-making state enterprises, and imposing taxes after taxes to raise revenue and to meet high debt payments.

Jamaica has been in and out of IMF programmes over the years that one can easily lose count on their fingers. Several of our neighbouring islands have had to turn to the IMF for varying degrees of assistance to help stabilise their economies.

Our politicians are to be blamed for the massive mismanagement of the economies of most Caribbean islands since they started to gain independence from Great Britain.

A country can easily fall over the cliff and into difficulties when they are run by leaders who are only bent on making many unrealistic promises in order to win the electorate to their side each and every general election.

There are some leaders who want large sums of money in quick time and cannot wait on the bureaucracy that might exist in some organisations like the Caribbean Development Bank (CDB) and the Eastern Caribbean Central Bank (ECCB) where loans are given on much lower interest rates and other attached conditions.




Those leaders who are bent on the quick fix would choose to borrow money on the international markets that are given almost over night but attract high interest rates like nine percent and in the long run can be catastrophic to their people.

Former Barbados Prime Minister Owen Arthur is qualified to speak on whether IMF prescriptions can solve the problems of those countries that will have to run to the fund for a “rescue” package.

Arthur has to shoulder some of the blame for the current demise of the Barbados economy under the current Democratic Labour Party (DLP) administration of Prime Minister Frundel Stuart.

As the Prime Minister for over 10 years, Arthur, an economist by training, did his fair share of borrowing and helped to put the Barbados economy in jeopardy.

In Grenada, Dr. Keith Mitchell and his New National Party (NNP) governments over the years quite simple borrowed too much money at unsustainable levels and squandered millions in guarantees to fly-by night investors for ill-conceived projects and in the end Grenada did not have the means to service the mounting debts now estimated at EC$2.5 billion.

The macro-economist in the midst, Anthony Boatswain, the current Minister of Education who was Finance Minister in most of the years of NNP rule, sought to defend the massive borrowing by saying that creating debt was not a problem once you were making payments to the creditors.

Grenadians should now understand where Boatswain’s theory has landed the country as the IMF itself proclaimed that Grenada continues to be plagued by high unsustainable debts and other ills like high unemployment.

A change in the mindset of our leaders and the people is a key component of the rescue mission that is needed to take Grenada out of its current financial difficulties… and not three years of supervised Structural Adjustment by the IMF.

Our leaders must stop making false and empty promises that only serve to raise the expectations of the people and influence the choice they make on Election Day. This does not guarantee prosperity and sustained growth of the economy.

There is perhaps need for the introduction of a Centre for Population Education (CPE) institute but devoid of political consideration like 1979-83 to educate the people and help them to unmask those politicians who are only interested in “thiefing their head” on Election Day.

If the playing field continues to be occupied by many vulnerable players (the electorate), the smart politician will continue to have a field day and in the long run the country will never be able to get out of the vicious cycle of unemployment, high debts and poor social conditions and these ills have remain a permanent feature of the Grenadian landscape.

So Grenadians, please do not blame the IMF for our plight but look deep inside the country at the way we have been doing business as a people and government.

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